Happy Sunday to everyone on The Street. 

It’s not just the Canadian government anymore. Now the nation’s citizens are retaliating to Trump’s tariffs too. Consumers are urging each other to “shop Canadian” and some stores have gone so far as to stop stocking certain American-made goods like liquor.

That’s bad news for the likes of Jack Daniels-parent Brown-Forman $BF.A ( ▲ 1.03% ) , which called the boycotts “worse than a tariff” on its most recent earnings call. But I’m personally okay with it — as long as we don’t respond in kind. The moment I can’t get my hands on real maple syrup, I’m out of here.

Short Circuit

Two Highly-Shorted Stock Opportunities

You don't need us to tell you it was another tough week for investors. Mounting stagflation and recession fears have driven the biggest market sell-off in months. 

Evercore ISI $EVR ( ▼ 2.74% ) shortlisted various stocks with high short interest and low valuations. Its "dislocated diamonds in the rough" might just be buying opportunities amid the ongoing market turmoil.

In a recent note, senior managing director Julian Emanuel selected the most-shorted stocks that also have discounted P/E ratios. Top of the list? CrowdStrike $CRWD ( ▼ 2.58% ) and Advanced Micro Devices $AMD ( ▼ 3.22% ) .

Strike Back

Cybersecurity firm CrowdStrike hasn't fully put last year's software issues behind it. Its faulty update caused a massive global IT outage and dented customer confidence. The stock price fell earlier this month after it issued a disappointing earnings outlook. 

So much so that Evercore ISI says it is now trading at a discount of more than 70% compared to its five-year average. Not only that, but it is one of the most shorted large-cap stocks on the market.

If there's a bounce, Emanuel argues we could see a "short squeeze." This happens when prices rise and investors who've shorted the stock try to cut their losses. As they close out their positions, it can drive the price even higher.

In Short Order

Chipmaker AMD also underperformed in 2024. The stock fell around 18% last year, after gaining almost 130% in 2023. The reasons for its decline are less clear-cut, but NVIDIA's $NVDA ( ▼ 1.58% ) dominance is a big factor. Some argue that expectations for the sector were simply too high.

AMD's latest results were underwhelming, mainly because of disappointing data center figures. Evercore ISI cut its price target in February, though it still maintains an Outperform rating. But with expectations much lower now, the mix of a discount price tag and abundance of short interest might just be alchemic for investors.

2024 was challenging for AMD and CrowdStrike in different ways. But Evercore thinks it would be short-sighted to dismiss them completely.

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Can a US Listing Unlock Ashtead’s Value?

Growth Amid a Slump

Ashtead Group $ASHTF ( ▼ 5.53% ) , which owns the popular construction equipment brand Sunbelt Rentals, has had a rough go of it recently. The company missed both revenue and profit estimates in its latest earnings results. Shares have slumped nearly 16% in the past 12 months, now hovering around their lowest level since October 2022.

Despite the setback, a recent Barron's article points out that there is still a lot to like about the company. RBC $RY ( ▼ 2.24% ) analyst Karl Green believes that the current levels present an attractive entry point for investors, and rates the stock a Buy.

Why a US Move Matters

A major catalyst on the horizon is Ashtead’s planned US listing. The company, which operates 1,200+ locations across the US and generates 85% of its sales in North America, is looking to move its primary listing from London to the US.

Barron’s believes Ashtead’s London listing has held back its valuation. US industrial stocks trade at higher multiples, and a US listing could attract more investor interest and capital.

Similar moves by companies such as CRH $CRH ( ▼ 4.34% ) and Ferguson Enterprises $FERG ( ▼ 1.52% ) led to strong post-listing gains. Currently, Ashtead trades at a meager 14.1x forward earnings, despite targeting a growth rate twice that of its competitors.

A US listing also means potential index inclusion, broader investor participation, and improved access to deeper US capital markets. These factors could re-rate Ashtead’s stock, making it a more attractive investment.

Industrial Recovery Incoming?

Ashtead isn’t just banking on a listing change. The company’s underlying business fundamentals are also improving. The North American rental equipment market has grown from $57 billion in 2018 to $78 billion in 2024, as more companies opt to rent rather than buy machinery.

Additionally, even amid a broader downturn, US industrial activity is showing signs of a rebound. The ISM Manufacturing PMI recently rose above 50, signaling growth after a prolonged slump. Moreover, a backlog of $1.9 trillion in North American megaprojects points to strong demand for construction equipment in the coming years.

Ashtead’s Sunbelt 4.0 strategy aims to capitalize on this trend, targeting $14 billion in revenue by 2028, up from $11 billion in 2024. If the plan succeeds, Melius Research’s analyst Rob Wertheimer sees the company’s valuation climbing to 21x 2026 earnings.

Together With RYSE

The Sharks Laughed at Ring—Until Amazon Paid $1.2 Billion

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Robotaxis Won't Take Your Uber

In Uber Drive

The last six months have been an uphill drive for Uber $UBER ( ▼ 2.82% ) . But its troubles might just be in the rearview.

Investors have been worried about Tesla's $TSLA ( ▼ 3.51% ) planned “robotaxi” production and the wider growth of autonomous vehicles. However, Barron's argues that the popular rideshare company is nowhere near the end of the road. The publication believes that robotaxis aren’t a threat to Uber’s business, but an opportunity.

Uber has already started to partner with self-driving cab companies. Plus, an expanding rideshare market could translate into more use cases and more vehicles.

Back Seat Drivers

Ridesharing is an important part of Uber's business, but it is far from the only thing that keeps the company on the road. With apps on over 171 million phones, Uber has plenty more gas in the tank.

Barron's highlighted two other wheels of its business with a lot of potential:

• Super app: Five years ago, CEO Dara Khosrowshahi unveiled plans to make Uber the "operating system" for everyday life. It's still a work in progress, but one with potential.

• Advertising: Albion Financial Group says Uber only needs to take a small bite of the digital ad market to make a big difference to its bottom line.

Driving Force

All that said, a recession could throw a wrench in the works. For example, cash-conscious consumers may cut back on Uber's food delivery services if the economy slows.

But most analysts believe the upside outweighs the downside, per MarketWatch. 46 of 60 rate it a Buy, while just 6 rate it Overweight. BofA Securities $BAC ( ▼ 3.08% ) recently raised its price target to $95. That's 33% up on Friday's close. 

Many analysts think Uber could still be king of the road. If they're right, investors could be in for quite a ride.

Last Week’s Poll Results

Which sector do you think will outperform in 2025?

🟨🟨🟨🟨🟨⬜️ Healthcare

🟨🟨🟨🟨🟨⬜️ Defense

🟩🟩🟩🟩🟩🟩 Technology

And, in response, you said

• Healthcare — “People will still need some kind of healthcare.”

• Defense — “I believe there are conflict tensions in the air for 2025, and for all of those tensions being created, defensive equities must be in the front of the investment world.”

• Technology — “Technology is what makes the wheels go round. Healthcare and Defense are subsets of Technology.”

Are you bullish or bearish on Carrier Global (CARR) over the next 12 months?

🟩🟩🟩🟩🟩🟩 🐂 Bullish

🟨🟨🟨🟨⬜️⬜️ 🐻 Bearish

Are you bullish or bearish on YETI Holdings (YETI) over the next 12 months?

🟨🟨🟨🟨🟨🟨 🐂 Bullish

🟨🟨🟨🟨🟨🟨 🐻 Bearish

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